.Novembro 2008

Lyfe cicle is a fundamental tool that we use has a rational to ensure our decisions. Products life cycle is like a person lyfe cicle: there are some physical activities that we can not do with 85 years old (like run a marathon), but the maturity that we achieved allow us to have, for eg. balanced decisions, solid experience to give to younger people. So there are good and bad consequences of age. Like a product life cycle, The conditions in which a product is sold changes over time and must be managed as it moves through its succession of stages. It is claimed that every product has a life cycle. It is launched, it grows, and at some point, may die. Thus, the life cycle may be useful as a description, but not as a predictor; and usually should be firmly under the control of the marketer. The important point is that in many markets the product or brand life cycle is significantly longer than the planning cycle of the organizations involved. Thus, it offers little practical value for most marketers.

And you can look for the life cycle management in different aspects, such as who is expected to be your customers during each stage, wich are the implications of each stage on the characteristics of the market and also in the strategy of the marketing mix. We must not forget that marketing management itself can alter the shape and duration of a brand's life cycle, according to the strategic objectives of the company.
In the introduction stage the cost is high, sales volume are low, there is no/little competition, customers have to be prompted to try the product, and probably only 3% of the potential market customers will be innovative enough to try the product. Our marketing objectives must be to create awareness of our brand.
In the development stage costs are reduced due to economies of scale, sales volume increases significantly and profitability also. There is public awareness, and competition begins to increase with a few new players in establishing market . You can use a price strategy to maximize market share without harm your profit expected.
Your marketing objectives must be to strengthen interest in your product and increase quickly your market share.
In the Maturity stage costs are very low as you are well established in market & no need for publicity. You achieve sales volume peaks, there is an increase in competitive offerings and prices tend to drop due to the proliferation of competing products. Your marketing objectives should align with brand differentiation, feature diversification, as each player seeks to differentiate from competition with "how much product" is offered . Also the industrial profits go down. In this stage we should try to maintain our market share.

Lyfe cicle is a fundamental tool that we use has a rational to ensure our decisions. Products life cycle is like a person lyfe cicle: there are some physical activities that we can not do with 85 years old (like run a marathon), but the maturity that we achieved allow us to have, for eg. balanced decisions, solid experience to give to younger people. So there are good and bad consequences of age. Like a product life cycle, The conditions in which a product is sold changes over time and must be managed as it moves through its succession of stages. It is claimed that every product has a life cycle. It is launched, it grows, and at some point, may die. Thus, the life cycle may be useful as a description, but not as a predictor; and usually should be firmly under the control of the marketer. The important point is that in many markets the product or brand life cycle is significantly longer than the planning cycle of the organizations involved. Thus, it offers little practical value for most marketers.

And you can look for the life cycle management in different aspects, such as who is expected to be your customers during each stage, wich are the implications of each stage on the characteristics of the market and also in the strategy of the marketing mix. We must not forget that marketing management itself can alter the shape and duration of a brand's life cycle, according to the strategic objectives of the company.

In the introduction stage the cost is high, sales volume are low, there is no/little competition, customers have to be prompted to try the product, and probably only 3% of the potential market customers will be innovative enough to try the product. Our marketing objectives must be to create awareness of our brand.
In the development stage costs are reduced due to economies of scale, sales volume increases significantly and profitability also. There is public awareness, and competition begins to increase with a few new players in establishing market . You can use a price strategy to maximize market share without harm your profit expected.

Your marketing objectives must be to strengthen interest in your product and increase quickly your market share.
In the Maturity stage costs are very low as you are well established in market & no need for publicity. You achieve sales volume peaks, there is an increase in competitive offerings and prices tend to drop due to the proliferation of competing products. Your marketing objectives should align with brand differentiation, feature diversification, as each player seeks to differentiate from competition with "how much product" is offered . Also the industrial profits go down. In this stage we should try to maintain our market share.

In decline stage, the less attractive for marketeers but most interesting for finance departments because costs become counter-optimal (the best in profit is usually the maturity stage), sales volume decline or stabilize ; prices and profitability diminish, and profit becomes more a challenge of production/distribution efficiency than increased sales. The laggard customer tends to start to buy the product in this stage, so is very usefull to identify his needs and to communicate just for him. Your marketing objectives should be to reduce costs and to prepare the withdraw.
So, as you can see is just like a person life where you have to adapt to each stage where your product is. Very interesting is to evaluate the sales force remuneration during each stage, because your objectives managing their motivation changes during each step of the way. For instance, when you launch a product your variable part of the income of the sales force should be very high, to motivate people to achieve quickly a stronger position in the market.

In the decline stage because you don´t expect any ambition from your sales force with this product, an probably they are focused on other products, your remuneration should be predominantly fixed.
Even though Life Cycle Management validity is questionable, it can offer a useful 'model' for managers to keep at the back of their mind. Indeed, if their products are in the introductory or growth phases, or in that of decline, it perhaps should be at the front of their mind; for the predominant features of these phases may be those revolving around such life and death.